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The Magnolia Moonshot 2030 Movement

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This blog was collectively written by the Magnolia Moonshot 2030 Project Founders and is provided by Darcy Winslow, one of the founders.  It is a companion to her interview on Innovating Leadership, Co-creating Our Future titled Academy for Systems Change and the Magnolia Moonshot 2030 Project that aired on Tuesday, February 16th, 2021.

 

In order to meet the challenges of our time, we need to shift our thinking as individuals and as a society. The profound changes that are necessary today require a shift in our paradigm of thought and a shift in consciousness from an ego-system to an eco-system awareness. The deeper we move into the complex, volatile, and disruptive challenges of the twenty-first century, the more this hidden dimension of leadership moves to center stage. The blind spot in the 20th century toolkit of economics and management can be summarized in a single word: consciousness.

Consciousness is a thread that connects the 3 Divides (attribution to Otto Scharmer); a shift in consciousness will illuminate the interconnections among the Spiritual, Social, and Ecological Divides thus creating the conditions for current realities to transform into our desired common futures.

We are called to live with courage and collective integrity, for our survival and ability to thrive.

Spiritual Divide

Consciousness is our fluid basis for how to proceed with kindness, listening, learning, self-reflection, connection to self, and awareness of other. We have a human crisis resulting from people thinking of self in an egoistic way rather than as a higher Self who sees the bigger picture of us as community. Our aspiration is to support the inherent value of each person and create a flourishing world for all of us. We are warriors of love, calling all like-minded people to join us in changing the paradigm from “me, we, they” to a global and universal “us”.

The Spiritual divide manifests in rapidly growing figures on burnout and depression, which represent the growing gap between our actions and who we really are:

  • 1 person dies every 40 seconds from suicide (World Health Organization). There are 800,000 deaths per year from suicide, which is the leading cause of death in developing countries for people age 15-49. (Institute For Health Metrics And Evaluation, Global Burden Of Disease 2010)
  • Depression and anxiety disorders cost the global economy US $1 trillion per year and people with mental health conditions often experience severe human rights violations, discrimination, stigma (WHO)
  • Most disorders classified within mental health — that is depression, anxiety, bipolar and eating disorders  — are more common in women than men. This pattern appears to hold true across most (in some cases all) countries. (org).
  • The annual cost of burnout to the global economy has been estimated to be $323.4 billion. Such costs have led to the World Health Organization predicting a global pandemic within a decade (and now here we are with COVID!).

Social Divide

Empathy is when we can enter into another’s reality without judgement to radically listen, radically see, and radically imagine. This is how we earn the right to be heard. By being witness bearers and showing empathy towards our sisters and brothers we deepen our connectedness. People everywhere will collaborate to create a future where we can heal the social divide(s) and create a world where all people have enough. Our deep connectedness and shared consciousness will guide us to create physical, social, and economic well-being where all can flourish. This can only happen if we are in tune with nature, understanding of our inescapable interconnectedness, and design our ways of living to be in balance. Our deep connectedness and shared consciousness will guide us to find the way back to each other.

Current statistics reflecting the social divide include:

  • The necessary contribution of women is difficult in a world where, despite representing close to half of the world population, women are under-represented in decision-making bodies. This lack of representativeness is significant: in 2016, just 22.8% of the total of national members of parliament and 4% of CEOs of biggest Fortune 500 companies were women. And in 2011, women occupied only 7% of ministries of the environment, energy or natural resources and represented some 3% of those responsible for science and technology.
  • Racism, racial discrimination and xenophobia are global phenomena. Each regional context is different and victims differ in language and culture. But the experience of exclusion, subordination, violence and discrimination is remarkably similar.  Racism as a worldwide phenomenon requires a worldwide response. (The World Conference against Racism, Racial Discrimination, Xenophobia and Related Intolerance)
  • Access to water and sanitation are recognized by the United Nations as human rights, reflecting the fundamental nature of these basics in every person’s life. Lack of access to safe, sufficient and affordable water, sanitation and hygiene facilities has a devastating effect on the health, dignity and prosperity of billions of people, and has significant consequences for the realization of other human rights.
  • There is enough food to feed 7+B people, but we have a distribution problem: over 1B people have too much food, and over 1B people have too little food.

The Ecological Divide.

The ecological divide describes the fact that humans have organized our economic and social systems largely without regard to ecological limits on a global scale. We are supporting our needs (and in many cases our wants) through degradation of the very systems we need to sustain our species and other species on earth over the long-term.

Through innovations in technology and medicine over the past several centuries, (wo)mankind has successfully extended our natural lifespan and enhanced our quality of life (in developed countries), at the expense of the natural world. We have found ourselves in a ‘negative reinforcing cycle’ and are out of balance with the natural world.

Wealthier developed countries are thriving, while those in the least developed countries struggle to survive day to day while striving for the lifestyle of the (overly) developed countries. This is a moral dilemma as well; if all countries were to achieve our (on average in the US) lifestyle, the collapse of ecosystems would accelerate beyond all scenarios.

The ecological divide relates to the socio-economic divide because the organization of our social and economic systems has a great deal to do with our transgressing the boundaries of earth’s systems; we will have to consciously re-organize these systems if all humans are to have a good life on a sustainable planet. This also requires us to pay attention to equity, inter-generational and international harm, climate justice, and public participation–all socio-economic divide issues.

Ultimately, we need to bring humans back into a consciousness of earth’s limits and how we can have a good quality of life while respecting these limits. We, as individuals and society at large, need to regain congruence between our beliefs and values and how we live and work. This requires both science–to tell us where the limits are and to understand how ecological systems function–and spirit–to value the well-being of humanity and the planet more than our own excessive material consumption. This is where the ecological divide links to the spiritual divide; consciousness, care, and simplicity–all spiritual virtues–will have to be a part of bridging this divide.

There are many examples:

  • We are depleting and degrading our natural resources on a massive scale, using up more nonrenewable precious resources every year. Although we have only one planet earth, we leave an ecological footprint of 1.75 planets; that is, we are currently using 75% more resources than our planet can regenerate to meet our current consumption needs.
  • Burning fossil fuels to generate energy, clearing natural ecosystems for human uses such as development and agriculture, and generating waste that is difficult to dispose of without harming wildlife and ecosystems all contribute to climate change.

 

To become a more innovative leader, you can begin by taking our free leadership assessments and then enrolling in our online leadership development program.

Check out the companion interview and past episodes of Innovating Leadership, Co-creating Our Future, via iTunes, TuneIn, Stitcher, Spotify, Amazon Music and iHeartRADIO. Stay up-to-date on new shows airing by following the Innovative Leadership Institute LinkedIn.

 

About the Author

The founders of the Magnolia Moonshot 2030 Project collectively wrote this article, which was provided by Darcy Winslow. Darcy is one of the founders of the Magnolia Moonshot 2030 Project and the President and co-founder of the Academy for Systems Change. The Academy advances the field of awareness-based systemic change to achieve economic, social, and ecological wellbeing. Darcy worked at Nike, Inc. for 21 years and held several senior management positions, most notably starting the Sustainable Business Strategies in 1999 and as Senior Advisor to the Nike Foundation. She serves on the board of The Carbon Underground and The Cloud Institute for Sustainability Education.

 

What Does It Take to Be an Educational Leader in 2021?

We will be publishing some excellent guest writer blogs on Thursdays for the next few months.  This week the blog is provided by Jennifer Brown and is a companion to the interview with Mike Davis and Mark James, Junior Achievement — A Case Study in Disruption that aired on 11/12/2019.

 

The classroom offers no shortage of challenges for teachers, from navigating the different learning needs of a diverse group of students to keeping up with changing educational trends and policies. Plus, because of the 2020 pandemic, educators had to suddenly transition to remote-learning models, which was almost impossible to prepare for. And as many schools across the country re-open for full- or part-time classroom education, teachers have had to create structures that not only keep their students engaged but also adhere to COVID-19 health and safety standards.

While these types of obstacles are enough to keep some teachers engaged for a lifetime, others set their sights on even greater challenges within the educational system that will be in place long after the pandemic is over. However, transitioning out of the classroom into an educational leadership role isn’t as simple as throwing your hat in the ring. While classroom teachers are leaders in their own right, serving as an administrator requires a set of leadership skills all its own.

What it Takes to Be an Educational Leader

Becoming an educational leader is an opportunity to make an impact beyond the classroom. However, while teachers have ideas about the ways they’d lead differently given the opportunity, taking those ideas and turning them into actionable policies requires a unique set of skills.

When running a classroom, teachers have to make decisions moment by moment to keep their classrooms running smoothly and their students learning. Administrators, on the other hand, have to carefully consider the input of a variety of stakeholders before taking action.

In order to balance the demands of educational policies, district administrators, teachers, and parents, administrators must cultivate a culture of mutual respect and honest communication. That’s not easy to do when teachers often view administrators as a hindrance to their ability to teach, which is why an educational leadership role requires not only professional acumen but emotional intelligence as well.

The Demand for New Educational Leaders

For teachers who are up to the challenge of educational leadership, there’s no shortage of roles to fill. While teacher shortages draw the most attention, schools across the country are also facing a growing shortage of principals and other administrators. According to the National Association of Secondary School Principals, the demand for qualified principals in elementary, middle, and high schools is projected to grow 6 percent by 2022.

While some school districts struggle to attract candidates for leadership roles, most schools find that their problem isn’t the number of candidates, but the quality. One in three school principals stay in their role for less than two years and 18 percent leave the position within a year. Inadequate preparation is a leading reason for high principal turnover, which is why teachers are such attractive candidates for the job. When administrators have a background in education, they’re not only less likely to leave, they’re also more effective.

The Role of Educational Leaders in Student Achievement

What are the hallmarks of an effective educational leader? It’s not just an understanding of policy or a knack for juggling competing priorities. Experts agree that the most effective administrators are those who frame their decisions around what’s best for student learning — and that means creating a collaborative environment between teachers and administrators rather than taking a top-down approach to management. When administrators foster an environment that empowers educators, the sense of safety, support, and continuous learning that’s created trickles down to students as well. In fact, research has found that an emphasis on collaboration and communication is one of the key characteristics of high-performing schools.

Advancing your Career as an Educational Leader

While teachers are uniquely positioned to become educational leaders, taking that career leap requires additional qualifications. School principals require graduate-level degrees in educational leadership or administration in addition to state licensure, while educators who want to expand the opportunities available to them may opt to pursue a Doctorate in Education. With an EdD, educators can pursue a career as a K-12 principal, school superintendent, or an administrator in a post-secondary setting.

Pursuing a career as an educational leader isn’t a decision to make lightly. School administrators have a difficult job, and creating an environment that empowers students and teachers — both during and after the pandemic — requires professionals who understand the difference between leading and ruling. However, for teachers who appreciate the challenges facing their school system and want to make a difference, taking the step into an educational leadership role is the best way to do it.

 

To become a more innovative leader, you can begin by taking our free leadership assessments and then enrolling in our online leadership development program.

Check out the companion interview and past episodes of Innovating Leadership, Co-creating Our Future, via iTunes, TuneIn, Stitcher, Spotify and iHeartRADIO. Stay up-to-date on new shows airing by following the Innovative Leadership Institute LinkedIn.

 About the Author

Jennifer Brown is a guest writer.

Image via Pexels

 

6 Essential Leadership Lessons Learned from Experience

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This blog is provided by Ron Riggio, author and Professor of Leadership and Organizational Psychology at Claremont McKenna College, as part of the International Leadership Association’s interview series.  It is a companion to his interview on Innovating Leadership, Co-creating Our Future titled Becoming a Better Leader: Daily Leadership Development that aired on Tuesday, February 9th, 2021.  Ron recently published a new book called Daily Leadership Development: 365 Steps to Becoming a Better Leader.

 

How to turn experiences into valuable leadership lessons

What is Wisdom?

I found myself pondering this question the other day and I think I have an answer: Wisdom comes from a combination of learning from experience, reflecting deeply on those experiences, and applying the scientific method (that is, trying to find objective support for what you have learned, and/or testing whether what you have learned, or what you think you have learned, is valid).

Here are some leadership lessons that I have learned from the combination of experience, observation, and what we know from the research literature on leadership.

  1. Be Authentic. It is critically important to let others know where you stand on issues. Dealing straightforwardly with others is the key to authenticity. Indeed, authentic leadership is becoming a very popular theory of leadership. Learn more about this here.
  2. Communicate, Communicate, Communicate. Arguably, the biggest mistake that leaders make is under-communicating. Many times leaders believe others know more than they actually do. Make sure to let others know what is going on – the direction the company is taking, any critical changes (particularly those that may affect them), and address any rumors that are going on with information that informs workers. It is nearly impossible to over-communicate.
  3. Don’t Be Stingy with Praise. Too many leaders dole out praise like it is money from their own pocket. Show appreciation for the accomplishments of others – and do it frequently. Research supports the idea that positive reinforcement is extremely effective, and under-used.
  4. The One Hour Rule. This is a more practical lesson and it comes from an informal policy at my previous institution. The “one hour rule” refers to a norm that typical department, committee, or team meetings should be scheduled for no more than one hour. If a longer meeting is needed, people are told in advance. What is the lesson for leaders from this rule? Use your time wisely. Don’t waste others’ time needlessly. If you can get it done in 15 minutes, get it done!
  5. Be Patient, But Not Too Patient. We all work at different paces, and sometimes people take longer to perform a task than we would, or complications arise that delay completion. Learn to be patient with others, but it is also important to not allow unnecessary procrastination. Leaders can cut followers some slack, but not too much.
  6. Be Kind, But Not Too Kind. Leaders need to be aware of the power dynamic and avoid being too overbearing. Kindness can go a long way toward building good leader-follower relationships. It is important, however, for a leader to not allow followers to take advantage of that kindness. More on this here.

What are some of your important leadership lessons learned from experience?

 

To become a more innovative leader, you can begin by taking our free leadership assessments and then enrolling in our online leadership development program.

Check out the companion interview and past episodes of Innovating Leadership, Co-creating Our Future, via iTunes, TuneIn, Stitcher, Spotify, Amazon Music and iHeartRADIO. Stay up-to-date on new shows airing by following the Innovative Leadership Institute LinkedIn.

This article was originally posted on Psychology Today.

 

About the Author

Ron Riggio is the Henry R. Kravis Professor of Leadership and Organizational Psychology at Claremont McKenna College. He is the author of more than a dozen books and more than 100 research articles and book chapters in the areas of leadership, organizational psychology, and social psychology. Ron is the former Director of the Kravis Leadership Institute at Claremont McKenna College. He has served on the board of numerous journals and writes the Cutting-Edge Leadership blog at Psychology Today.  At the 2020 International Leadership Association’s annual conference, Ron was one of two people awarded the Lifetime Achievement Award.

 

Photo by Brett Jordan on Unsplash

Three Problems of Power—Problem Three: Distance and Dehumanization

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This blog is provided by Margaret Heffernan, author of the book, “Uncharted: How to Map the Future Together.”  Margaret’s interview is also part of the International Leadership Association Interview Series.   It is a companion to her interview on Innovating Leadership, Co-creating Our Future titled “Uncharted: How to Map the Future Together” that aired on Tuesday, January 19th, 2021. The past two weeks have featured the first two problems.  Problem one was Pleasing and problem two was Silence and Blindness.  This is the final week of the series.

 

Problem Three: Distance and Dehumanization

When CEO of Lehman Brothers, Richard Fuld was driven from his home to a heliport, then helicoptered into Manhattan, driven in another limo to the bank’s offices where a private elevator sent him up to his office. This ornate commute ensconced him in a physical bubble that no weak signals or accidental encounters could penetrate. This physical manifestation of power may look like luxury but it comes at a cost. The bubble of power seals off bad news, inconvenient detail, hostile opinion and messy reality, leaving leaders free to inhale the rarefied air of pure abstraction. Like the cave dwellers of Plato’s parable, the powerful risk mistaking shadows for reality.  Power inserts distance between those who have it and those who do not. It determines whether you fly in the peaceful isolation of a private jet or the middle row in economy, next to the mother who needs help with her restless child. Power lets you, like the Google founders, arrive at meetings via paraglider, not stuck in San Francisco traffic.

The physical distance experienced by the powerful is amplified by the psychological distance of hierarchies. Frances Miliken, who helped to pioneer the research into organizational silence, also studied how those in power communicate differently from those without it. Her language analysis showed a more common use of abstractions and a tendency to over-optimism. Experimentation showed that people given power demonstrate more stereotyped thinking. Further from the action, reinforced by a sense of their own capability, the combination of power, optimism and abstraction made them more confident of their own judgement. The more cut off from others, the more certain they were of their decisions about people and detail they did not know.

That it is a problem is obvious in catastrophes like the COVID pandemic and Hurricane Katrina or, in the UK, the fire at Grenfell Tower. In each case (and there are many more) big decisions are made by confident, optimistic people who think largely in abstraction. Some even regard this as an asset, as when one executive recently suggested to me that it would be better for layoffs to be decided by leaders too far from the action to know the people impacted by their decisions. Distance, dehumanization were seen as assets.

This is the third problem of power. Its status and rewards erode judgement. This isn’t wholly inevitable; a few leaders I’ve known have had the humility and tenacity to fight it, to reach into, rather than over, the crowd. But it is phenomenally difficult to disbelieve the worship of the crowd. If the world chooses to throw all these goodies my way, it must be because I’m worth it — mustn’t it?

I retain a visceral memory of this from the 1990s. Running tech companies, I saw many of my friends and colleagues get rich fast. They went from pretty humdrum individuals in January to exhilarated millionaires by June. And most of them believed the money.

It confirmed that they were special. They’d always thought that might be true, but here was proof. The rare few just put the money away and carried on before. When I asked them, saying they’d been lucky. They didn’t believe the money, seeing it instead as a market fluke. But most got sucked into a reaffirming circle: more money, more power, more confidence, greater distance from the crowd.

They make — and we make — the same mistake: an attribution error. It’s logical, but not necessarily true, that the success of an organization owes something to its figurehead. But how much? Did GE flourish because of Jack Welch or has it failed because of his legacy? Did Apple succeed after Steve Jobs’s return because of his unique magic, or did his hapless competitors’ lame innovation play a role? In the statistically implausible 41 quarters out of 42 that Microsoft met or beat its market forecast, was that the genius of Bill Gates or of his accounting team? If Johnson & Johnson is so well run, how did its role in the opioid scandal occur? If Fred Goodwin was, as celebrated by a Harvard Business School case study, the “master of acquisition,” why did the Bank have to be rescued by the U.K. government?

You can’t run the experiment. It’s impossible to cut the company in half and run half with one leader and half with another. So it is beguilingly simple to attribute success to the powerful individual at the top. And it is supremely difficult for most people, at the height of their power, to see how much their success owes to circumstance, the talents of others, the weakness of competition and to sheer luck. Easier to believe the money. Easier to believe the power.

Such attribution errors flourish in part because we feed them. Believing that a company or a country succeeds or fails because of one mighty person is simple and alleviates our anxiety. It turns a complex world into a simple narrative: we have only to change the person to change the story. Context, apparently, counts for nothing.

The problems of power are damaging not only for those with power — but for the rest of us too. The more we believe in the leadership myths, the more we absolve ourselves of responsibility and action: just wait for Superman or Superwoman to turn up, and everything will be fine. The costly investment in leadership training (said to be over $300 billion) is a sign not of its effectiveness but our urgent desire to simplify and to believe. Critics argue most of this money has no effect. The reality may be worse than that: worshipping leaders may exacerbate the problem it pretends to fix. As long as we believe in leaders, we need not examine our own failure to act on our values and insight.

Of course, all three problems of power feed each other. Failure to learn to think for oneself makes us more credulous of leadership, and it can paralyze those given power. Absence of conflict and debate perpetuates the problem. And if we make it to the top, years of passivity and conventional wisdom make it likely we will believe in our own celebration. This risks making us more aggressive; it can also make leaders justifiably afraid.

I’ve always been wary of the concept of leadership. In part, this was a language problem: when translated, the words duce and fuhrer had unpleasant connotations. We used to talk about bosses or managers but in the late 1970s, that started to change. This is also the period when American economic inequality began to increase markedly. Since then, the clamor for leadership has grown louder as inequality has become more pronounced. The expectation that a sole individual can, singlehandedly, alter complex realities has inflamed faith and guaranteed disappointment.

It’s time for a reset.

 

 

To become a more innovative leader, you can begin by taking our free leadership assessments and then enrolling in our online leadership development program.

Check out the companion interview and past episodes of Innovating Leadership, Co-creating Our Future, via iTunes, TuneIn, Stitcher, Spotify, Amazon Music and iHeartRADIO. Stay up-to-date on new shows airing by following the Innovative Leadership Institute LinkedIn.

 

About the Author

Margaret Heffernan is the author of the best-selling UNCHARTED: How to Map the Future Together, nominated for a Financial Times Best Business Book award. She is a Professor of Practice at the University of Bath, Lead Faculty for the Forward Institute’s Responsible Leadership Programme and, through Merryck & Co., mentors CEOs and senior executives of major global organizations. She is the author of six books and her TED talks have been seen by over twelve million people.

Photo by Grant Durr on Unsplash

Leading Sustainability: Look to the Future, Make Bold Choices and Don’t Go It Alone

This blog is provided by Trista Bridges and Donald Eubank, co-founders of Read-the-Air and authors of a new book, “Leading Sustainability: The Path to Sustainable Business and How the SDGs (Sustainable Development Goals) Changed Everything.”  It is a companion to their interview on Innovating Leadership, Co-creating Our Future titled Leading Sustainability: The Path to Sustainable Business and SDGs that aired on Tuesday, January 5th, 2021.  This article shares practical steps from their book to advance your business efforts to put sustainability at the core of your strategy.

 

The business world is at a fundamental crossroads. The age of the stakeholder is rapidly superseding that of the shareholder. More than just a buzzword, the idea of the stakeholder recognizes that companies have always existed as an inseparable part of the communities and business networks in which they operate, however vast and physically distant.

Contrary to what the shareholder model often implied, good business decisions have never really been driven purely by profit motives. It is becoming increasingly obvious that what is good for society—and thus, by definition, for the environment—is good for business.  This new embrace of responsibility does not preclude the design of efficient, lucrative business models. In fact, when done properly, precisely the opposite is true: socially responsible and sustainable business decision-making opens up brand new, exciting, profitable—and, in all its meanings, sustainable—revenue streams.

Today’s reckoning is not purely an altruistic choice made by businesses; new demands from various civil society organizations and the consensus-driven initiatives of the United Nations have been shepherding along the changes required to make business operations sustainable for years. With the United Nations’ 17 Sustainable Development Goals (SDGs) and the implementation of the Paris Agreement, these constituencies have outlined new expectations for not only how governments function, but also how businesses must function in a sustainable society.

The SDGs—more than 50 years in the making—provide a comprehensive framework for understanding all aspects of social, political, and business actions. They are powerful statements of human ambition for a fair, just and sustainable society. Many in the business and investing world today are calling them “A gift”, as the SDGs can provide us with a broader definition of sustainability and a framework to quickly and effectively guide businesses’ efforts to align their operations with the meaningful goals that society desires.

The successful businesses of tomorrow will be the ones that fully embrace sustainability today.

Almost two years ago, we set out to find and catalogue the practical steps that companies today must take to create the new sustainable business models they will need to survive in the year 2030. We interviewed more than 100 business leaders, investors, policy makers, NPOs, researchers and other changemakers, and researched a broad range of companies from across the world, of varying sizes and across multiple industries, that were taking practical steps to improve business practices and become more sustainable. Here’s some of the main takeaways that were collected for our new book “Leading Sustainably—The Path to Sustainable Business and How the SDGs Changed Everything.”

Our takeaways

  • Look to the future of your business—to achieve the best tomorrow, prepare today for the worst.
  • Make changes to your strategies based on the big picture, not on the small problems (unless they are warning you about dangers arising in the big picture).
  • The past created the world we live in today—its environmental crises and social unrest—but it also has been building the platform and the thinking that’s needed to move past these crises. That is, the SDGs, the Paris Agreement and a business world more focused on becoming sustainable for the long run.
  • The business case is already there—the whole business environment is pushing for more sustainable models, from consumers to investors, employees to competitors. Catch up, keep the pace, set the speed or get pushed out of the way.  And watch out, because a whole new generation of “mission-driven” companies have a head start already, having established themselves as fully aligned with society from the get-go. They are laser-focused on bringing fully sustainable innovations and business models to sectors that have struggled to do so on their own, and they are achieving remarkable societal and financial impact.
  • Don’t get confused by the Alphabet soup of methodologies for measuring and managing impact—choose what looks best for you, try them out, see if they fit, and whether do or don’t, adjust, retry, expand, until you figure out what works for your company. Get started today.
  • Capital managers, and even retail investors, believe that sustainability is the way forward, and they are going to talk to you about it. If you are aligned with them, they will provide you capital at a reasonable rate—if not, you will pay more or even be left empty-handed.
  • Be systematic. Understand the steps that you as a business have to proceed through to achieve a sustainable business model. Apply smart managerial and leadership strategies to move through these steps. Make bold decisions. Engage the whole organization. Communicate your directives and the reasons. Build an “A team”. Pursue a multi-stakeholder approach. Be flexible, make assessments and adjust. Work with your customers. Consider outside acquisitions. And leverage the SDGs.
  • You can’t do this alone. Bring your industry along for success and to ensure a fair playing field. Reach out to your industry associations, but also look to new partners, whether from civil society, international organizations, or cross industry. If a few key industries do this right—health and wellness, insurance, fashion, real estate, and tourism—we’ll all be in a better, more sustainable, place.

Before we close, two points bear repeating: For success leverage the SDGs— recognize their power to help and guide the organization and your teams; and be systematic to align your business planning and operations with sustainability principles.

Plus, remember this final, key piece to getting it done: You must bridge the knowledge gap—provide your teams with as many opportunities as possible to learn what they need to know to make sustainability-driven business decisions.

 

See more details about the important lessons from companies—in a range of industries—on how to achieve sustainability in our new book “Leading Sustainably”, available now from Routledge and Amazon.

To become a more innovative leader, you can begin by taking our free leadership assessments and then enrolling in our online leadership development program.

Check out the companion interview and past episodes of Innovating Leadership, Co-creating Our Future, via iTunes, TuneIn, Stitcher, Spotify, Amazon Music and iHeartRADIO. Stay up-to-date on new shows airing by following the Innovative Leadership Institute LinkedIn.

 

About the Authors

Trista Bridges is a strategy and marketing expert with extensive experience across various geographies and sectors including consumer products, financial services, technology, and healthcare.

Donald Eubank is an experienced manager who has worked across the IT, finance, and media industries in Asia.

They advise businesses on sustainability and are co-founders of Read the Air, a coalition of strategy and operations professionals, and co-authors of “Leading Sustainably—The Path to Sustainable Business and How the SDGs Changed Everything” (Routledge).

 

Photo by Aaron Burden on Unsplash

Leading During a Crisis: Explosion in Beirut, The Aline Kamakain Story

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Maureen Metcalf, ILI’s CEO and Founder is a Fellow with the International Leadership Association (ILA). In this role, ILA recommends 12-16 interviews for her radio show focusing on innovating leadership. The show focuses on balancing academic excellence in leadership with personal stories of high impact leaders and thought leaders and authors talking about their latest books and frameworks.

The following blog accompanies an interview with Aline Kamakian. This interview, specifically Aline’s Story, was very moving and inspiring. We encourage you to learn more about Aline by listening to her interview titled Thriving During Crisis: A Successful Middle Eastern Businesswoman that aired Tuesday, December 22nd, 2020. If you feel moved to donate during the holidays to a person and organization in Lebanon impacted by the recent explosions, please consider supporting Aline and her efforts to re-open Mayrig to provide jobs for 85 staff.

This is Aline Kamakian’s Story.

As someone who has a master’s degree in business, I recognize that we can learn things in school, from books and lectures, but there are things that only life teaches us.  Being a Lebanese of Armenian origin, I grew up with my grandparents embedded in the stories about my ancestors. Their stories about the resilience and ability to adapt and the respect and gratefulness to the country that accepted them conveyed the values I learned.

On 4 Aug 2020, Beirut was hit by a huge blast.

According to BBC reporting, “The blast that devastated large parts of Beirut in August was one of the biggest non-nuclear explosions in history, experts say. The Sheffield University, UK, the team says a best estimate for the yield is 500 tons of TNT equivalent, with a reasonable upper limit of 1.1 kilotons. This puts it at around one-twentieth of the size of the atomic bomb dropped on Hiroshima, Japan, in 1945… The explosion was the result of the accidental detonation of approximately 2,750 tons of improperly stored ammonium nitrate. The blast led to some 190 deaths, as well as more than 6,000 injuries.

My restaurant, our offices, my house and my car were all blown to pieces in just a second. The terrace outside of our meeting room looked out over the port just 300 meters further. We were having a management meeting. I don’t know how I survived, standing on the terrace, looking at the fire and fireworks in the port. The next thing I remember was standing over my financial controller and giving him CPR. I don’t know how I knew what to do, reflexes from when I was a girl scout? The blast had injured 25 employees, of which five were left with a permanent handicap. It destroyed most of the restaurant furniture and equipment. The building was still standing, but windows, doors, winter gardens were all shattered.

First, I needed to make sure all my employees were safe and had a roof over their heads. I had never felt a victim, but there was no way I could get back on my feet without external help. So, I decided to open a fundraising page to help us. One week after the blast, we started cooking over 1,000 meals per day in our central kitchen to be distributed among those who lost their homes. We prioritized, first comes the team, holding on to our values, generating income, moving on, and moving fast.

On the 4th of September, just one month after the blast, the restaurant opened its garden and kitchen again. While we were still working hard to repair and rebuild the inside of the restaurant. The first evening that the restaurant was again partly operational, the whole team had dinner on the Mayrig terrace.

Here is the reporting about the restaurant:

 

When 2,700 tons of ammonium nitrate tore through Beirut, only a highway separated the city’s port where the explosives were stored from 282 Pasteur Street. This is where Mayrig, the famed Armenian restaurant known as much for its delectable sour cherry kebab as preserving Armenian culture in one of the diaspora’s strongholds, has stood since 2003.

Located in Beirut’s lively Gemmayzeh neighborhood in a building from when Lebanon was under Ottoman rule, the restaurant was destroyed.

It joined the rest of the city that stood in ruins, where over 170 people have died, thousands more injured, and an estimated 300,000 left homeless. The decimation the blast caused came on top of a Beirut that was already in political and economic crisis. The Lebanese pound was tumbling to shocking lows that have caused widespread poverty. Electricity and food shortages are the norms.

But the destruction of Mayrig stung beyond a crumbling building: around 85 families, whose livelihoods depended on the restaurant, were suddenly left jobless and homeless. Not a single staff member escaped unscathed, and some are still in critical condition.

And then there’s the other, more existential loss: the idea that an institution fighting to preserve and progress Armenian culinary heritage, which has always teetered on the brink of either being forgotten, denied, or erased, could disappear forever.

“Mayrig” means “mother” in Armenian. For the last 17 years, this woman-owned culinary institution has brought centuries-old recipes from inside the homes of the Armenian community in Lebanon to a restaurant enjoyed by both local and international patrons and built on those traditions to create new dishes. Staffed by the same Armenian mothers who have always led the preservation and passing down of food culture to future generations through their labor and knowledge, “Mayrig” was founded by Aline Kamakian.

Being at “Mayrig,” she said, is being alive.

Her grandparents, Armenian Genocide survivors, found refuge in Lebanon, becoming part of the Lebanese-Armenian diaspora, which now numbers over 150,000 and has contributed significantly to the social, political, and cultural life of the city while keeping Western Armenian heritage alive. Bourj Hammoud, one of the first places refugees settled, became the historic center of the Lebanese-Armenian community. The area was heavily impacted by the explosion.

Aline’s early Story

I was five years old when the war broke out in Lebanon. I have seen my father as an entrepreneur struggling to raise his family and keep us safe during the war. This taught us to be creative and find means under pressure and create solutions to the absence of necessary provisions such as electricity and water and fundamental civil human rights. For example, to open my restaurant in 2003, I had to build my water reservoirs, bring a generator to produce electricity, ensure the team’s transportation and basic needs, and find other locations during the war.

Preparation for Management During Crisis

In the war in 2006, we took three days to find a safe spot up in a mountain resort. This move made it possible to guarantee the continuity of the restaurant and the employees’ income. We had to build our reserve in fuel; bring walkie-talkies because there was no phone; secure a safe location for employees to sleep, and secure kitchen equipment from the kitchens of friends and family. We created a restaurant in 1-weeks’ time. The most important tools were: sharing information, make the team part of the decision making, delegate responsibilities. In these circumstances, it is about operating a restaurant and the security of the team. Almost half of them were living in dangerous areas. The team managed to work and did so without days off, without hours to rest to cover for the others. We agreed that we would see how to cover extra hours or vacation after we passed this crisis. We learned to adapt to respond to this disruption quickly. It turned out to be a right decision because it generated enough income to secure the salaries, and it offered the chance for the employees to continue working.

Every two years, we have a minor to big crisis that asks for our adaptation. In 2019 the revolution started after three years of financial difficulties and corruption scandals. The challenges were different and led to significant hardship.

  • The internal security was terrible; roads were blocked, breaking and burning buildings and public property.
  • The banking sector turned into an unpredictable mess. Lebanon was known for its strong banking sector and was the saving place for all the Lebanese diaspora. And suddenly, the banks stopped giving out money. There was a limitation on cash withdrawals and transfers. The impact was dramatic since Lebanon is mainly an importing country. Its own industries ae very limited and the country has very little raw materials.
  • Inflation towered: Lebanon rates now 3rd worldwide after Venezuela with an inflation rate of 365%. The challenge is that it is not just inflation but also inflation that the government doesn’t recognize. There is an official rate, a rate from the banks, and a black-market rate.
  • Covid-19 led to lockdowns in many countries; in Lebanon rules were not applied evenly over the whole territory as some political parties allowed their followers to disregard the rules. COVID spread fast in autumn, and governmental regulations are often contradictory from one week to the next, unequally applied and harmed first of all the whole Food and Beverage sector.
  • With a government that is corrupt, and incapable comes the explosion of 4 August. The government resigned, but since it hadn’t formed a new government yet, the old government continued in the same corrupt, incapable way.

How to lead in such a context?

University lectures didn’t teach us to navigate this type of crisis. I didn’t learn a to-do list.

In the restaurant business, never compromise on the quality. The challenges were to keep the quality. We couldn’t look at saving money during this catastrophic crisis. We were committed to living our values during the crisis.

  • We needed to keep the employees safe and secure cash. I created a pop-up project in Saudi Arabia and took part of my staff there for three months.
  • We were committed to maintaining food quality. The aim is to find the best product at the best price, not the cheapest product. We needed to keep the team quality-oriented, encourage sharing resources, information, and pay attention to finding the best ingredients.
  • I communicated very openly, explained the companies’ situation, and explained the difficulties of living in Saudi Arabia. We went as one team and worked together to maintain the team as in Lebanon, there was no income.

My goal was to jump on opportunities that would allow me to take care of my family and my team! I didn’t have all the info, but the circumstances required me to keep going. I knew I needed to be transparent, genuine, honest, and always make values-based decisions. In this case, I was focused on my team’s safety, health, and economic well-being.

Again I did the same thing: first comes the team, holding on to your values, generating income, moving on and moving fast.

 

Aline Kamakian acted in the best interest of her team during the most challenging experience of her life. She truly exemplifies someone who is living her values! She supports the families of the employees who are unable to work and who continue to require significant medical treatment. During our call, she deeply inspired me as a leader and person who acted as her best self during this crisis. We often look to movies for superheroes. I believe Aline is a real-life superhero. Her actions inspire and invite all of us to act with courage, integrity, and selflessness. To support her campaign, please consider donating to the Mayrig Family Go Fund Me campaign.

 

To become a more innovative leader, you can begin by taking our free leadership assessments and then enrolling in our online leadership development program.

Check out the companion interview and past episodes of Innovating Leadership, Co-creating Our Future, via iTunes, TuneIn, Stitcher, Spotify and iHeartRADIO. Stay up-to-date on new shows airing by following the Innovative Leadership Institute LinkedIn.

 

About the Author

Aline Kamakain began her career as an insurance broker at the age of 18 to put herself through college. She graduated with a double major in Masters in Finance and Marketing, Aline’s skills as an insurance broker allowed her to build one of Lebanon’s top 9 Brokerage Firms. All through her successes, Aline never forgot her love for food but most importantly she never forgot her Armenian roots. In June 2003, she opened “Mayrig” an avant guardiste traditional Armenian restaurant to introduce to all those who appreciate homely, healthy and tasty food, the forgotten flavors of Ancient Armenia. Aline was also voted Women Entrepreneur of the Year 2014 in the Brilliant Lebanese Awards. She is a board member of the Lebanese Franchise Association as well as a board member of the Lebanese League of Woman in Business and a successful candidate of the 2014 Vital Voices Fellowship Program.

Photo by rashid khreiss on Unsplash

 

Vertical Development: Elevating Your Leadership

Vertical Development: Elevating Your Leadership

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This blog is provided by Ryan Gottfredson, Assistant Professor of Leadership at California State University-Fullerton, author of Success Mindsets and a Mindset Consultant/Trainer/Speaker.  It is a companion to his interview on Innovating Leadership, Co-creating Our Future titled Success Mindsets: Your Keys to Unlocking Greater Success in Your Life that aired on Tuesday, December 15th, 2020.

 

There are two types of development leaders can go through: horizontal development and vertical development.

Horizontal development involves helping leaders add more knowledge, skills, and competencies. The focus of horizontal development is on helping leaders to DO more.

It is not unlike adding a new app to an iPad, making it more capable of performing more functions

Vertical development involves helping leaders elevate their thinking capacity to better navigate more complex and uncertain environments. The focus of vertical development is on helping leaders to BE more able.

Instead of adding a new app to an iPad, vertical development is upgrading the iPad to a newer, more capable model

Question: Of these two forms of development, which is most commonly focused on for leadership development?

The vast majority of leadership development focuses exclusively on horizontal development. Very little leadership development focuses on vertical development.

Why is Vertical Development So Important for Leaders?

When two different leaders with different altitudes of vertical development encounter a situation that is low in complexity, both of these leaders are likely to navigate this effectively.

But, if those same leaders encounter a situation that is high in complexity, it is likely that only the one with greater vertical development will be able to handle this effectively.

This is critical to understand because leaders are facing increasingly facing more and more complex and uncertain circumstances, something that the COVID-19 pandemic hasn’t helped with.

This hopefully demonstrates that vertical development can be a competitive advantage for individual leaders as well as for entire organizations.

Quick Vertical Development Self-Assessment

Here are questions that I have come across that might be decent revealers of leaders’ altitude of vertical development:

  • How do you respond to constructive criticism?
  • Would you be willing to let someone survey your employees about your effectiveness as a leader?
  • Is it bad to build close relationships with those you lead?
  • Can you hold competing perspectives on a controversial topic (e.g., abortion)?
  • Do you generally focus on the outcomes you want or on the drivers of the outcomes you want?
  • When something goes wrong, do you ask yourself: “Who am I being that their eyes are not shining?”

How do we help leaders vertically develop?

To improve leaders’ vertical development, we must get to the core of one’s verticality: Their mindsets.

Both psychology and neuroscience has independently identified mindsets as the foundational mechanism that governs leaders’ processing and operations. This is because our mindsets are our mental lenses that shape how we see and interpret our world, and how we see and interpret our world shapes the quality of our thinking, learning, and behavior.

Fortunately, there have been 30+ years on mindsets, which has led to the identification of four sets of mindsets, ranging on a continuum from less vertically developed and more vertically developed.

 

 

These mindsets come to life when we recognize the common desires that flow from these mindsets:

If you would like to assess the quality of your mindsets, I have developed a FREE personal mindset assessment, which can be taken here: https://ryangottfredson.com/personal-mindset-assessment

To Summarize…

Most leadership development focuses on horizontal development, but because of the increasing complexity and uncertainty in our world, we need leaders that are vertically developed.

In order to develop vertically, we must get at the core of our verticality: our mindsets.

If we can become conscious and aware of our mindsets, it provides us with the opportunity to shift to a more elevated way of processing and behaving.

Climb on!

 

To become a more innovative leader, you can begin by taking our free leadership assessments and then enrolling in our online leadership development program.

Check out the companion interview and past episodes of Innovating Leadership, Co-creating Our Future, via iTunes, Google Play, TuneIn, Stitcher, Spotify and iHeartRADIO. Stay up-to-date on new shows airing by following the Innovative Leadership Institute LinkedIn.

 

About the Author

Ryan Gottfredson, Ph.D. is a cutting-edge mindset author, researcher, and consultant. He helps improve organizations, leaders, teams, and employees by improving their mindsets.

Ryan is the Wall Street Journal and USA Today best-selling author of “Success Mindsets: The Key to Unlocking Greater Success in Your Life, Work, & Leadership” (Morgan James Publishers). He is also a leadership professor at the College of Business and Economics at California State University-Fullerton. He holds a Ph.D. in Organizational Behavior and Human Resources from Indiana University, and a B.A. from Brigham Young University.

As a consultant, he works with organizations to develop their leaders and improve their culture (collective mindsets). He has worked with top leadership teams at CVS Health (top 130 leaders), Deutsche Telekom (500+ of their top 2,000 leaders), and dozens of other organizations. As a respected authority and researcher on topics related to leadership, management, and organizational behavior, Ryan has published over 19 articles across a variety of journals including: Leadership Quarterly, Journal of Management, Journal of Organizational Behavior, Business Horizons, Journal of Leadership and Organizational Studies, and Journal of Leadership Studies. His research has been cited over 2,500 times since 2015. Connect with Ryan here.

Image by Gerd Altmann from Pixabay

Navigating Change

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This blog is provided by United States Navy Rear Admiral Deborah Haven, Retired.  It is a companion to her interview on Innovating Leadership, Co-creating Our Future titled Leading Through Change: A Military Perspective that aired on Tuesday, December 1st, 2020.

 

Here are my observations and takeaways from my experience navigating change in a wide variety of global logistics organizations supporting the US Military and our allies. Much of my experience has been leading change which ranged from crisis response establishing and maintaining a logistics hub to support the Haiti citizens from their devastating earthquake to contingency operations mobilizing Naval Reservists in support of expeditionary logistics missions in Iraq and Kuwait to operating system upgrade implementing a SAP system which replaced a legacy system.   These experiences shaped my approach to leading change in a dynamic environment and provide the foundation for the following article.

How a leader handles change will determine the team’s future.  A leader’s attitude toward change will be a key to success. I learned early on that I could spend energy resisting change, or I could embrace the change to keep moving forward.   A leader must look at change in a positive and realistic light. The leader needs to be the steady rudder to keep everyone on course.  This will require the leader to keep their “resiliency tank” full at all times to stay tough during the challenges ahead.  Figure out how to keep your “resiliency tank” full, whether it is meditating, exercising, or playing chess.  Your strength will be needed so a resiliency routine will have to be a priority.  Encourage your team members to establish a resiliency routine too.

The leader’s job is to clearly articulate the WHY …and repeat the message …over and over.  This gives time for the team to catch up.  In most cases, the leader has had time to absorb the new information before the idea is introduced to the entire team. When the change is introduced to the team, the team needs time to grasp and embrace the new idea. The leader is going 100 miles an hour down the highway with the new idea and team is just getting to the highway on ramp.  As the leader, you may need to slowdown so your team can speed up.  I did not say stop. Once the team absorbs the idea, understands the mission, and is empowered to execute, it will accelerate and exceed expectations. One key point is knowing that not everyone engages the change in the same manner.  Some individuals struggle with the new idea and may feel threaten by what they see taking place.  The employee’s role may change.  He or she may go from expert to novice in the new arrangement.  Resulting in an unsettling emotional reaction.  And will usually get better over time for most individuals. This is something to be aware of during the process. A leader needs to watch out for those struggling and engage through listening and understanding the challenges the workforce is undergoing.  Sometimes an empathetic ear from the leader can be the tonic to pull the team member through the rough waters of change.  Also, some individuals just take longer to adjust to the new environment, but others soar to the future state.

I have also noticed that the technique that makes teams more successful in new unknown areas is to create an open dialogue about the challenges and work through them collaboratively with the stakeholders. Easily said, not always so easy to do but rewarding in the end.  Continual communication about the compelling need for the change is a must do and must be repeated often.

Some best practices when dealing with change:

  • Set trust as the foundation for all relationships.
  • Identify the key stakeholders and communicate the compelling reason for the change …the WHY.
  • Uncover the blind spots as quick as possible through listening and learning.
  • Create collaborative teams to develop solutions for the blind spots identified.
  • Build coalitions that do not exist and shore up ones that need to be reinforced.
  • Stay strong throughout by listening and understanding the barriers or challenges anchoring others.
  • Be agile. Do not get defensive when new information is received, and adjustments must be made.
  • Establish a routine and regular check-in, set goals, and follow up on progress using accountability metrics.

Have a bias for action…keep moving forward.

The takeaway here is that during a significant period of change is when the leader really earns his or her money.  They need to be authentically enthusiastic and fully engaged to ensure the team members are making the transition.  This can be exhausting work but extremely rewarding.

 

To become a more innovative leader, you can begin by taking our free leadership assessments and then enrolling in our online leadership development program.

Check out the companion interview and past episodes of Innovating Leadership, Co-creating Our Future, via iTunes, Google Play, TuneIn, Stitcher, Spotify and iHeartRADIO. Stay up-to-date on new shows airing by following the Innovative Leadership Institute LinkedIn.

 

About the Author

United States Navy Rear Admiral Deborah Haven, Retired, has been a successful leader in a wide variety of global logistics organizations, both civilian and military for over 30 years.  She is particularly skilled at introducing change in large organizations.  She has a keen ability to understand the landscape, identify barriers and develop an actionable plan to improve organizational effectiveness.  Deborah is a graduate of the Naval War College, holds an MBA from the LaSalle University in Philadelphia, and a BS from the University of Maryland, College Park. She is an executive coach, independent consultant, and a member of the board of directors for the Flag and General Officer Network.

Seeking to Understand: Advice to Successfully Implement DEI Initiatives

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This blog is written by Maureen Metcalf and summarizes 5 recommendations Roger Madison shared about how leaders can improve the outcomes of diversity, equity and inclusion (DEI) initiatives.  It is a companion to the interview with Roger on Innovating Leadership, Co-creating Our Future titled Diversity and Inclusion Insights from IBM South Africa Experience that aired on Tuesday, November 24th, 2020.

 

Recently, I was honored to interview Roger Madison, a successful person of color overcoming discrimination and bias.  Let me share a little bit about Roger.

Roger’s Background

Roger grew up in Farmville, Virginia, and went on to earn  his Bachelor’s of Science in Business Administration from the George Washington University School of Business and Government Studies.   He is the Founder and CEO of iZania, LLC, which he established in 2003 after a successful career as a sales executive for IBM, some of that time was spent in South Africa.  iZania.com is an online community of Black entrepreneurs, professionals, and consumers, dedicated to economic and social empowerment. His goal is to help bridge the digital divide.

Roger’s passion is helping to prepare young people for the business of life. He is actively engaged in our community as a board member, volunteer, and mentor with Junior Achievement of Central Ohio, Big Brothers Big Sisters of Central Ohio, and Boys and Girls Clubs of Columbus.

He is married to his lovely his wife, Joyce, and they live in central Ohio.  They have been blessed with two adult children and two grandchildren.

 

Our Conversation

I believe part of the solution to diversity, equity, and inclusion involves understanding people’s experiences impacted by discrimination. During the interview, Roger shared the story of his struggles when his high school was closed because of the Brown vs. Board of Education legal battle. Roger also shared how bias impacted his ability to perform during his early college years and how his experience in the U.S. Air Force helped him develop the skills and confidence required to complete his college degree.

Roger was among the first and often only black person in a job or role. He found ways to thrive, even in overtly discriminatory environments. He is talented, able to self-advocate, and also fortunate to have had the opportunities he did. As described above to young people, he now gives back, helping them understand the business of life. He also serves as a role model and mentor for many others through his direct work at iZania and other community work.

I encourage you to listen to his full interview at the link here.

 

Roger’s Recommendations

Based on Roger’s unique experience, here are the five steps he recommends to improve outcomes from DEI initiatives.

  1. Undertake an honest assessment of the current status of your organization.  Understand the perceptions of DEI issues of existing employees.  Their perceptions represent the reality of your organization.  This has to be the starting point.
  2. Set measurable goals for change. Establish a vision of the inclusive environment you are working toward.  Commit to targets of inclusion, similar to the affirmative action programs of the 1970s.
  3. Create a pipeline to sustain the targets you establish.  Ensure meaningful representation at entry, middle, and senior levels of your organization.  This means providing opportunities for advancement with mentorships, special assignments, and broad exposure across all organizational areas.
  4. Be an advocate for the vision of an expanded culture of inclusion.  Leaders must lead.  This is not an assignment to delegate to the Chief Diversity Officer.  There may be a need for a Chief Diversity Officer to execute programs, but leadership must reside at the top.
  5. Follow through with the execution of plans to reach the goals established.  DEI must be a commitment, not an option.

We encourage you to look at how your organization is doing against your DEI goals, and if you don’t have DEI goals, how you are doing compared to where you think or wish you were. If you are not meeting your goals, take action. If you are in a formal leadership role, you can take significant action. If you are an individual contributor, you can be an advocate! All of us have a role to play in the evening the playing field. Thank you for playing your role well – to create a world where everyone has equal opportunities.

 

To become a more innovative leader, you can begin by taking our free leadership assessments and then enrolling in our online leadership development program.

Check out the companion interview and past episodes of Innovating Leadership, Co-creating Our Future, via iTunes, Google Play, TuneIn, Stitcher, Spotify and iHeartRADIO. Stay up-to-date on new shows airing by following the Innovative Leadership Institute LinkedIn.

 

About the Author

Maureen Metcalf – Founder, CEO, and Board Chair of Innovative Leadership Institute – is a highly sought-after expert in anticipating and leveraging future business trends to transform organizations. She has captured her thirty years of experience and success in an award-winning series of books which are used by public, private and academic organizations to align company-wide strategy, systems and culture with innovative leadership techniques. As a preeminent change agent, Ms. Metcalf has set strategic direction and then transformed her client organizations to deliver significant business results such as increased profitability, cycle time reduction, improved quality, and increased employee engagement. For years, she has been willing to share her hard-won insights – through conference speaking opportunities, industry publications, radio talk-shows, and video presentations.

 

Capitalism Needs a Rethink – Evolving Toward a Stronger and More Equitable Future?

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This blog is provided by Ty Montague, co-founder & CEO of co:collective, a creative and strategic transformation partner for purpose-led businesses.  It is a companion to his interview on Innovating Leadership, Co-creating Our Future titled StoryDoers: Leaders and Organizations with Clearly Defined Higher Purposes that aired on Tuesday, November 17th, 2020.

 

It is fair to say we live in a world described as volatile, uncertain, complex, and ambiguous (VUCA). In James Stoller’s recent book, he indicates, “One way to define the “action of our time” is to ensure high performance under pressure in a VUCA world. People do not have to adapt to VUCA, though as W. Edwards Deming cautioned, “It is not necessary to change. Survival is not mandatory. VUCA rewards excellence and is harsh on mediocrity.” As we consider excellence in corporate performance, we must rethink how we define the corporation’s foundational role. Many corporate titans call for just this change to how we think about the corporation’s role in the national and global ecosystem.

To inform this conversation, let’s start with some history. On September 13th, 1970, Milton Friedman published what would become known as the Friedman Doctrine — a seminal essay on a corporation’s purpose.  The full essay is worth a read; the central thesis can be boiled down to a few sentences:

“Some businessmen (sic) believe that they are defending free enterprise when they disclaim that business is not concerned “merely” with profit but also with promoting desirable “social” ends; that business has a “social conscience” and takes its responsibilities seriously for providing employment eliminating discrimination, avoiding pollution and whatever else might be the catchwords of the contemporary reformers. They are — or would be if they or anyone else took them seriously– preaching pure unadulterated socialism. Businessmen who talk this way are the unwitting puppets of the intellectual forces that have been undermining the basis of a free society these past decades”.

In my view, the world is a worse place today because of it. Why? Well, to say that Freidman’s Doctrine made an impression on the business world would be an understatement.  It was a frying pan to the head of the day’s conventional capitalist philosophy — let’s call it humanist capitalism — which held that enlightened business leaders needed to consider the needs of a broader set of stakeholders, not just shareholders.  This form of capitalism essentially created the bountiful economic environment in America between the end of WWII and 1970 and created the middle class.  Thwak!  With a single essay, Milton Friedman killed humanist capitalism as dead as a doornail. That thwak resounded broadly — it echoed through the hallways of America’s elite business schools and whanged around inside the boardrooms of our largest corporations. Looking around at the world today, many of the most challenging problems we face in America are a direct result of Friedman’s idea — let’s call it predatory capitalism.

Over the next several decades, many corporate leaders, following Friedman’s directive that the sole purpose of a corporation is to maximize profits for its shareholders, hacked away at internal costs by paying the lowest possible wages, providing less training, less PTO, less maternity leave and less healthcare protection. They fought unions. They held the minimum wage at sub-poverty levels. Simultaneously they found ways to artificially lower the cost of their products by externalizing as much cost as possible, for example, by dumping the by-products of their manufacturing processes into the public common (our air and our water) and then refusing to take any financial or legal responsibility for cleaning up the mess.

The truly predatory behavior happened at the regulatory level where corporations began to relentlessly lobby to lower the corporate tax rate (resulting in, for instance, public schools today that can’t afford critical supplies) and to continuously weaken environmental protections (resulting in, for example, the existential threat of our time, climate change).  But the real damage occurred when they succeeded in changing the laws around political contributions to maximize their ability to press their giant fingers on the scale of democracy and tip the entire system permanently in their favor. This effort culminated recently in the landmark Supreme Court decision, Citizens United,  which formalizes corporations’ recognition as people.  As full “citizens,” with all of the rights (but few of the responsibilities) that come with citizenship, companies can now contribute unlimited amounts of money to political contests, which, under the decision, is defined as corporate “free speech.” So, their voice in the political process is now exponentially louder than yours or mine.

So when we look around today at the ominous condition of America today — an unprecedented and growing gap between the haves and the have-nots, a devastated middle class, record rates of depression and drug abuse, an environment teetering on the edge of systemic collapse as evidenced by the rapid extinction of species, out of control wildfires, hurricanes and flooding events at record levels, et al,– in many respects, we have Milton Friedman to thank.

Now let’s shift to the optimistic view! And by the way, I’m also a capitalist. I believe that capitalism can solve these problems, and I think we already see some positive signs.  But we have to quickly evolve away from this extreme, predatory form of capitalism that enriches a handful of us to absurd levels.

We urgently need to re-discover the form of capitalism that created the most remarkable economic expansion the world has ever seen. The structure where all corporations, as well as all citizens, pay their fair share of taxes.  The capitalist system where corporations are corporations, not citizens, and don’t have an infinitely amplified voice in our political process. The structure of capitalism, where skill, creativity, and ambition are rewarded by upward mobility but not by savagely standing on our neighbors and fellow citizens’ necks. The structure of capitalism that values cultural and social diversity, where we remember that America was founded to be a melting pot and that this diversity makes us more resilient, not less.  The structure of capitalism incentivizes both short and long-term thinking about our planetary life support system — the natural environment. And let’s one-up the capitalism of the 1940s, ‘50s, and ’60s and pay attention to social justice, equity and inclusion while we’re at it.

Nice dream?

Maybe. But over the past ten years, we started to see some green shoots in this space. More and more companies are waking up because they have a broader responsibility than only enriching their shareholders directly.  We see innovations like the B Corp, and its stricter cousin, the “Benefit Corporation.”  We see the Conscious Capitalism movement take hold. We see powerful capitalists like Larry Fink, the CEO of Blackrock, taking up the cause — in his closely followed ‘annual letter to CEO’s’ in 2018, he stated that Blackrock (the world’s largest investment fund manager) would no longer invest in companies that are unable to articulate a higher social or environmental purpose. The Business Roundtable, comprised of the CEO’s of 200 of the largest corporations in the world, recently published an open letter proclaiming the exact opposite of the Friedman Doctrine, that the purpose of a corporation must not be solely to create profit for shareholders, but must also be to create value for a wide variety of stakeholders., These capitalist chieftains are not saying this exclusively to salve their souls. After all, they are capitalists, and they are saying this because they sense something new happening. A new generation of consumers won’t do business with companies that operate in the antiquated, predatory, Friedmanesque model.  “Woke” millennial consumers aren’t accepting it. Their POV on predatory capitalist enterprises of today?  “Change or die.  We’ll take either.”

So, the writing is on the wall. Capitalism and capitalists must evolve once again (as we always have and always should!).  If you run a company today, rather than resist this, my request is to get on the right side of history.  Get to work defining your higher purpose.  And then put it to work driving positive innovation and permanent change in your company, your community, and in the world. Your children and their children will thank you (by buying your products, for starters).

 

To become a more innovative leader, you can begin by taking our free leadership assessments and then enrolling in our online leadership development program.

Check out the companion interview and past episodes of Innovating Leadership, Co-creating Our Future, via iTunes, Google Play, TuneIn, Stitcher, Spotify and iHeartRADIO. Stay up-to-date on new shows airing by following the Innovative Leadership Institute LinkedIn.

 

About the Authors

Ty Montague co-founder & CEO of co:collective, a creative and strategic transformation partner for purpose-led businesses. Co: works with leadership teams to define their higher purpose and to bring that purpose to life through innovation in the customer experience. They call this process StoryDoing.  Ty published a book about StoryDoing in 2013 called True Story, and since that time the co: team has been fortunate to work with some of the most inspiring and progressive organizations and leaders, including Google, YouTube, LinkedIn, IBM, MetLife, Microsoft, the ACLU, Infiniti, Capital One, and Under Armour. He previously served as Co-President & Chief Creative Officer of J Walter Thompson North America and Creative Director of Wieden and Kennedy New York.

Maureen Metcalf, CEO of the Innovative Leadership Institute, is a renowned executive advisor, coach, consultant, author and speaker.

Photo by Markus Spiske on Unsplash